Transaction costs in global supply chains of manufacturing companies

  • Bremen P
  • Oehmen J
  • Alard R
  • 3

    Readers

    Mendeley users who have this article in their library.
  • N/A

    Citations

    Citations of this article.

Abstract

Outsourcing has advanced to an important measure that is applied broadly in operations management. Nowadays, suppliers of manufacturing companies do not only provide direct material like raw material and operational supplements but offer components and advanced modules incurring many value-adding stages. Whereas in the past companies built up local supplier networks, they recently tend to search for global or offshore sources. However, not all companies reach their expectations towards the success of global sourcing projects. Important reasons for relocating manufacturing capacities back to local suppliers or in-house manufacturing are costs for unexpected coordination activities, limited flexibility and declined or fluctuating quality. The theory of Transaction Cost Economics postulates that transaction costs of the types information, communication and coordination determine the governance structure of a supply chain, i.e. market, hybrid or firm. The objective of this paper is to analyze the cause-and-effect chain of inter-firm transaction costs concerning global sourcing. The resulting qualitative model based on explorative multiple-case study research will be validated in a survey among Swiss manufacturing companies.

Author-supplied keywords

  • global sourcing
  • low-cost
  • management
  • operations
  • outsourcing
  • transaction cost economics

Get free article suggestions today

Mendeley saves you time finding and organizing research

Sign up here
Already have an account ?Sign in

Find this document

Authors

  • P Bremen

  • J Oehmen

  • R Alard

Cite this document

Choose a citation style from the tabs below

Save time finding and organizing research with Mendeley

Sign up for free